I've become more interested in trading pure volatility. Can anyone give me some suggestions on that front? I don't mean trading the VIX, but I mean trading the fact that the market will move a certain percentage over the course of a given timeframe.
Aloha mate, i would suggest you joining me and the oil trading group in my journal and trading crude oil futures. I specialise in trading reversals, which rely on pure volatility, as if i see the market shooy up 2 t 4dollars straight i then wait for the top formation to form and then enter the trade fast to catch the pullback (40 t 100ticks in a few seconds t minutes).
1) What you may be looking for is called "sigma". 2) It is (volatility) multiplied by (price) divided by either the square root of (256 or 365). 3) You can then apply it to daily and weekly time frames as an objective, expected, measure of what the daily and weekly range may be for the market you are trading.